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Centene Corporation has signed a definitive agreement to acquire MHM Services, a national provider of healthcare and staffing services to correctional systems and other government agencies.

Under the agreement, Centene will acquire 100 percent of the stock of MHM, including its 49 percent ownership of Centurion, the correctional healthcare services joint venture between Centene and MHM.

MHM provides behavioral health, medical and dental services to governmental agencies in a variety of patient care settings, including correctional facilities, state hospitals, courts, juvenile facilities and community clinics. The business currently serves over 330,000 individuals in over 300 facilities across the United States.

"The addition of MHM will provide Centene with significant scale in the correctional healthcare services market," said Michael Neidorff, chairman and CEO of Centene. "For the past six years, Centene and MHM have successfully worked together to build Centurion, which now provides comprehensive, cost-efficient clinical programs for correctional systems in seven states."

Steven Wheeler, president of MHM and CEO of Centurion, added: "We are proud to continue our partnership with Centene, which shares our mission of providing better health outcomes at lower costs for the states. With a $10 billion annual cost of correctional healthcare in the US and 23 states currently outsourcing these services to private vendors, together we are positioned to create value for all of our stakeholders."

Centene said that it intends to fund the purchase price with a combination of cash and Centene stock. The transaction is expected to close in the first quarter of 2018, subject to closing conditions.